Dubai World proposal 'agreeable' for banks

Banks are finding debt proposals by government-owned conglomerate Dubai World "very agreeable", UAE Central Bank Governor Sultan bin Nasser Al Suweidi said yesterday.

Credit is growing at a reasonable rate in the UAE, Al Suweidi said.

"Our opinion is that, under the circumstances, it (credit) is growing at a reasonable rate," Suweidi told reporters on the sidelines of a financial conference in Dubai.

UAE money supply grew 2.1 per cent year-on-year at the end of April, down from a 3.3 per cent rise in the previous month, central bank data showed. M3, the broadest measure of money circulating in the economy and an indicator of future inflation, grew only 1.4 per cent in February in the slowest pace since at least 2001 as banks grappled with Dubai's debt restructuring.

It rose to Dh941.2 billion at the end of April, from Dh934.8bn at the end of March, the data showed. Money circulating in the second-largest Arab economy had more than doubled in the two years to the end of 2008. (With inputs from agencies)